Interesting books, and news items about books and periodicals, particularly with respect to political and social issues. (Note: In some versions of IE, the profile may appear at the bottom of the page with this template; I will look into it; Mozilla works fine.) Note: no one pays me for these reviews; they are not "endorsements"!

Friday, January 04, 2013

Stephen Moore: "Who's the Fairest of Them ALL?" Why "flat" is fair

Author: Stephen Moore (with Foreword by Glenn Hubbard)

Title: “Who’s the Fairest of Them All? The Truth About Opportunity, Taxes, and
Wealth in America”

First, let’s mention that this book went to press before the
“Fiscal Cliff” deal was patched together over the New Year’s holiday, and it
often mentions the Fiscal Cliff and upcoming debt ceiling issues, in order to
criticize Obama’s desire to make the rich pay higher marginal tax rates, as “fair”.

Morre offers the simple argument that well-off people are
typically more productive, and, when left alone from government, tend to
innovate more and raise the standard of living for everyone, including the
poor.

He offers many specific examples where innovations made
people rich, but those individuals (like Steve Jobs and Bill Gates) continued
to invent in such a way as to make everyone better off. And of course, in many areas of life, that is
certainly true.

He also argues that when marginal tax rates on higher
incomes are lower, rich people actually wind up paying a larger share of the
taxes. That seems to be true. He also argues for not taxing investment
income or corporations at all, because then, he says, companies will employ
more people. Perhaps so.

His last chapter is, “Why flat is fair”. Remember, back in the 1990s, Steve Forbes had
argued for a flat tax. Moore mentions
Hong Kong as a booming place with a flat tax. He also notes that states without state income
taxes (Texas) are generally faring better than the “high cost, high service”
states.

There is something a bit offensive about the tone of some of
this rhetoric. “We rich people employ
you and spend our money on your products, so you do what we say.” Coming from a Rand Paul in the Fiscal Cliff
debate, it sounds a bit like power hunger. And the opposite side of that is, of
course, “Marxist” class warfare. Moore
argues well that “workers” may indeed be better off when the rich keep more
about what they earn. There is, of
course, a good question: why not carve out lower rates for businesses hiring
workers, even closely held family businesses, and tax “discretionary” income
more and separately. Aren’t we doing
that sort of thing (social engineering) with child tax credits?

The media has portrayed this book as about “fairness”
although for more of its brief length it doesn’t seem so. It seems more about economic pragmatism. But there are places to pick bones. For example, the FICA tax has always been
separate, and “regressive” because it seems to be set up as a “pseudo-annuity”. Moore asks, is it “fair” to keep collecting
it when Social Security may not pay out in the future? That leads to the question, why not means
test social security payments now (maybe based on accumulated or inherited
wealth as well as income). But is that
fair to me? After all, I paid into the
system for thirty years expecting my “annuity”.
Is it fair that I should be stiffed? That just could happen if the debt
ceiling really gets broached early in 2013.

Moore does mention unwed mothers and welfare, but for the
most part he stays away from the social issues, and he is likely a social
libertarian. (Let me add here, that I
read this on the Metro, and got some dirty looks.)

But much of the current debate about social policy – most recently
gay marriage – has been about “equality” and “rights”, and about “fairness”
that goes beyond economic equity (for example, discrimination in the workplace
and equal pay for women) to the more subtle areas about how we perceive each
other as individuals, who obviously cannot all assume equal risks or equal “personal
responsibility” for results. People do “start
ahead in line” (or behind), and people do benefit from the unseen sacrifices of
others. That can generate indignation,
and sometimes violence and social or political instability. Totalitarian governments have tried to make
people share this sort of risk and burden more “equally”, and the end result can
be poverty for everyone. Look not only
at North Korea but also at Maoist China after the 60s. Social conservatives sometimes try argue that
the “natural family” should mediate local inequalities among people inasmuch as
they occur as part of nature, but then you have the problem that different
individuals (including gays and lesbians) sometimes have very different ideas
about how bloodline and family (and having children at all) fits into their
self-interest, and that feeds for inequality (as over discretionary income and
very personal sacrifice and risk taking).
Social values will certainly figure into the way we handle entitlements
in an aging population with fewer children.
How much of this needs to be the (not always chosen) responsibility of
other family members and not government?

A little technical note about the book. The text is not right-aligned, giving it a
ragged look, and there was at least one accidental font change.

Links

About Me

Since the 1990s I have been very involved with fighting the military "don't ask don't tell" policy for gays in the military, and with First Amendment issues. Best contact is 571-334-6107 (legitimate calls; messages can be left; if not picked up retry; I don't answer when driving) Three other url's: doaskdotell.com, billboushka.com johnwboushka.com Links to my URLs are provided for legitimate content and user navigation purposes only.
My legal name is "John William Boushka" or "John W. Boushka"; my parents gave me the nickname of "Bill" based on my middle name, and this is how I am generally greeted. This is also the name for my book authorship. On the Web, you can find me as both "Bill Boushka" and "John W. Boushka"; this has been the case since the late 1990s. Sometimes I can be located as "John Boushka" without the "W." That's the identity my parents dealt me in 1943!

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